State Farm’s Actions in Acknowledging Claim and Requesting Information Not Toll the Statute of Limitations

In New Jersey, claimants must file a lawsuit for any personal injuries suffered within 2 years of the date of the accident or their claim will be barred based upon the statute of limitations. Plaintiff Francis Suero was injured on January 13, 2010 when he was driving his vehicle and it was rear-ended by defendant Jennifer Gable-Schmidt, who was insured by State Farm Insurance Co. However, plaintiff failed to file suit until February 3, 2012, more than 2 years after the accident. The issue in Suero v. Gable-Schmidt, 2015 N.J. Super. Unpub. LEXIS 2703 (App. Div. November 24, 2015) was whether the plaintiff’s claim was barred due to the statute of limitations or whether the statute of limitations was tolled based upon State Farm’s conduct.

Two weeks after the accident, the plaintiff’s counsel sent a letter of representation to State Farm. He sent the police report and advised State Farm that he would send all medicals and bills as soon as the name of the adjustor became available. On February 15, 2010, State Farm acknowledged receipt and, in a separate letter, State Farm requested that plaintiff’s counsel supply a list of all treating medical providers, some information regarding plaintiff’s insurance policy and a completed medical authorization form. On February 22, 2010, plaintiff’s counsel sent a completed medical authorization but supplied no additional information or otherwise corresponded with State Farm.

Plaintiff’s counsel claimed that he did not believe he needed to send any further information to State Farm because in his extensive experience in negotiating claims with State Farm, State Farm would use the medical authorization to obtain whatever medical records were needed. Further, he certified that he spoke with State Farm’s adjustor some time in the fall of 2011 and “reasonably believed” State Farm was still investigating the claim. After the statute of limitations expired, the plaintiff’s attorney called State Farm to find out why he did not get an offer and was told for the first time that State Farm would not make any payment on the claim.

The defendant moved to dismiss the complaint based upon the statute of limitations. Initially, the motion was denied without prejudice. The motion was refiled seven months later and, at that time, was again denied.

On appeal, the plaintiff argued that State Farm should be equitably estopped from asserting the statute of limitations as a defense. However, the defendant argued that State Farm’s correspondence and conduct did not lull plaintiff into believing the case would be settled so as to estop defendant from asserting the statute of limitation as a defense. Further, defendant pointed to the lack of information provided to State Farm in the 2 year period, except for the police report and an executed medical authorization.

The Appellate Division noted that, as set forth in prior case law, the doctrine of equitable tolling of limitations has been applied only in narrowly defined circumstances. Although an insurer may not lull the other party into believing that he has time to file, its only duty is to act in good faith. In examining State Farm’s conduct here, the court found that State Farm’s words and conduct cannot reasonably be seen as having “lulled” plaintiff’s counsel into believing that he was relieved from filing a timely complaint.  State Farm sent two letters and received virtually none of the information it requested. Plaintiff’s counsel’s subjective belief that his experience in settling claims with State Farm relieved him of any further responsibility was not sufficient to estop the defendant from asserting the statute of limitations as a defense.

Further, the absence of prejudice to the defendant is not, by itself, a sufficient reason to estop defendant from prevailing on this defense. Hence, the Appellate Division reversed the trial court and dismissed the complaint.